How much can Jorge afford to spend on a monthly car payment if his excess monthly cash flow is $360, and he expects the following monthly expenses: $44 gas, $84 insurance, and $26 for maintenance and repairs? $206.
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When shopping for a new car which of the following should be the first step in the buying process?
1. Research vehicles and features.
2. Get preapproved for a loan.
3. Plan your trade-in.
4. Locate and test-drive the car.
5. Check sale price and warranties.
6. Review the deal and dealer financing.
7. Close the deal.
8. Take delivery.
What is the maximum percentage of your monthly income that should be spent on housing expenses according to the FHA quizlet?
For an FHA loan, under no circumstances may the borrower’s total monthly housing expenses exceed 31% of the borrower’s total gross monthly income. If a borrower has a gross monthly income of $3,000, he will be allowed $1,290 on an FHA loan for his total obligations, including housing expense and long-term debt.
What makes a car a bad investment quizlet?
The value a car adds to a household’s ability to increase human capital is too high to warrant the cost of insurance. … It is impossible to justify owning a car if someone has to borrow money for the purchase, which makes cars a bad investment choice.
What is a reasonable car payment?
Many financial experts recommend keeping total car costs below 15% to 20% of your take-home pay. … For example, if your monthly paycheck is $3,000, your car payment would be about $300 and you’d plan on spending another $150 on automotive expenses.
What is too much car payment?
Your total car payment (interest, principal, and insurance) should not exceed 10% of your gross income. Your dream car isn’t worth having if your monthly payments eat up all the extra room in your budget.
What credit score is needed to buy a car?
661
What is the difference between the retail price and the factory invoice price?
Manufacturer’s Suggested Retail Price for New-Car Buying. The manufacturer’s suggested retail price, or MSRP, is the price car manufacturers recommend dealerships sell their vehicles for. … The invoice price, or the dealer price, is the amount a dealership pays the manufacturer.22 avr. 2020
How can I speed up the process of buying a car?
1. Know How Much You Can Afford. Car finance from Latitude can help prepare you and allow you to speed up the car buying process.
2. Bring the Right Paperwork.
3. Vehicle’s Title.
4. Know What You Want.
5. Clean Your Old Car Beforehand.
6. Be Prepared and the Process Will Go Smoothly.
What is the 20 10 Rule of borrowing?
A conservative rule of thumb for other consumer credit, not counting a house payment, is called the 20-10 rule. This means that total household debt (not including house payments) shouldn’t exceed 20% of your net household income. (Your net income is how much you actually “bring home” after taxes in your paycheck.)20 mai 2019
What should be the maximum spending on housing if your gross income is 2400 per month?
What should be the maximum spending on housing if your gross income is $2,400 per month? $800. Landlords also have certain rights.
What is the maximum dollar amount of debt payments he should have?
The 20/10 rule says your consumer debt payments should take up, at a maximum, 20% of your annual take-home income and 10% of your monthly take-home income. This rule can help you decide whether you’re spending too much on debt payments and limit the additional borrowing that you’re willing to take on.
What is a main disadvantage of leasing a vehicle compared to buying a vehicle?
Thus up-front cost is the only main disadvantage of leasing a vehicle compared to buying a vehicle.1 mai 2019
Why are cars not an investment?
Your car may be considered an asset because you can sell it for a large amount of money. … But your car is not an investment. It depreciates over time. In the first year, most cars depreciate in value at least $1,500.
What is the APR for a loan that charges a $12 fee to borrow $100 for a loan period of 10 days?
What is the APR for a loan that charges a $12 fee to borrow $100 for a loan period of 10 days? 120% APR.